BY

HARDEEP SHARMA
Corporate governance is the set of policies, people, laws,
regulations and reporting of corporate business entities. It is a
primary focus of regulators in today’s world. Sound corporate
governance brings prosperity to the masses in the economy by
raising investor confidence and proper management of the
investments. Good corporate governance is vital for
organizations to survive.
Corporate Governance is defined as the general set of customs,
regulations, policies and laws that determine to achieve certain
targets for which a firm should be run. It is clear that corporate
governance exists at a complex intersection of law, morality and
economic efficiency, considering that issues of executive
compensation, financial scandals and shareholder activism are
all tied up with it. All parties to corporate governance have an
interest, whether direct or indirect, in the effective performance
of the organization. Directors, workers and management receive
salaries, benefits and reputation, while shareholders receive
capital return, customers receive goods and services and
suppliers receive compensation for their goods or services.
Ethics refers to a system of moral
principles a sense of right and wrong,
and goodness and badness of actions and
the motives and consequences of these
actions.
Ethics is seen as an individual’s own
personal attitude and a believe
concerning what is right or wrong, good
or bad. It is important to note that ethics
reside within individuals and that
organization doesn’t have ethics. People
have ethics
• No discrimination should be done on the basis of caste ,color , and religion,
• The polices should be fair and transparent
• Proper provision of safety should be provided by the company to the
employees.
• There should be proper honesty, loyalty, and integrity in the employees.
• The company’s resources should not be utilized by the employees for their
personal usage.
• Company should provide better environment condition Information about
employee’s personal lives, health, and work evaluations should be kept
confidential.
• Regular measurement of employee satisfaction should by company.
• To neither give nor take any illegal payment, remuneration, gift, donation,
or comparable, benefits to obtain business or favors.
• To comply with all regulations regarding preservation of the environment.
• Employee should report to management any actual or possible violation of
code or an event that could affect the business or reputation of the
employee’s company.
Corporate governance exists at a complex
intersection of law, morality and economic
efficiency, considering that issues of
executive compensation, financial scandals
and shareholder activism are all tied up
with it. Corporate governance also
includes the relationships among the many
stakeholders involved and the goals for
which the corporation is governed.
• The Board of Directors
• The Upper Management
• The Stock holders
• The Regulators and other Stakeholder institutions
• Reporting
• Company Policy
• Company Activity
• The CEO, Company Secretary, and CFO
• Meetings
 It focus on what our relationships are and
ought to be with our employees, our customers,
our stock holders, our creditors, our suppliers,
our distributors, our neighbors and other
members of the community / society in which
we operate.
 Questions, like moral responsibilities,
obligations and virtues in business decision
making also form part of ethics e.g. choices and
character of persons, the policies and cultures of
organization.
Ethics is concerned with the code of values and
principles that enables a person to choose
between right and wrong, and therefore, select
from alternative courses of action. Further,
ethical dilemmas arise from conflicting
interests of the parties involved.
a) The liberalization and de-regulation world over
gave greater freedom in management. This would
imply greater responsibilities.
b) The players in the field are many. Competition
brings in its wake weakness in standards of
reporting and accountability.
c) Market conditions are increasingly becoming
complex in the light of global developments like
WTO, removal of barriers/reduction in duties.
d) The failure of corporate due to lack of transparency
and disclosures and instances of falsification of
accounts/embezzlement and the effect of such
undesirable practices in other companies.
• Rights and equitable treatment
of shareholders
• Interests of other stakeholders
• Role and responsibilities of the
board
• Integrity and ethical behavior
• Disclosure and transparency
“There are those who will tell you that business and
ethics cannot stand together. In the short run it might
appear that companies pay a price for adhering to values
while their competitors get ahead in a shorter time
frame, but in the long run people would learn to
distinguish, stakeholders learn to ask the right questions,
and distinguish between the grain and chaff. Those that
don't subscribe to values will fall by the way side; those
that subscribe to values will last the course and will set
benchmarks.”
M. Damodaran Chairman, Securities and Exchange
Board of India
• Several corporate governance structures
• Extends beyond corporate law
• The committee has primarily focused on investors
and shareholders.
• Committee believes that its recommendations will go
a long way in raising the standards of corporate
governance
Committee primarily related to audit
committees, audit reports, independent
directors, related parties, risk management,
directorships and director compensation,
codes of conduct and financial disclosures.
 Brand image for the company

Greater loyalty

Greater commitment to the employees

The employees will become more creative

Every individual has to start culturing the
human values in the inner world of himself
because they say,
“Those who can see the deepest into the past
can also see farthest into the future”